To the Drug Companies to even the tech companies. ,rude is above 30 a barrel 32. 22. Yield is at 68 basis points. At 7. 1270. An we have president xi speaking today to the world health organization. Coming up later this hour, we will be speaking with the ceo of moderna, which is reporting some good initial promising results for vaccine tests. Us atne bancel will join 10 30 eastern. Guy looking forward to that conversation. The market certainly responding to that. Mostin europe, the beaten up sectors are rising the most strongly today. You can see the mining stocks up by 6. 9 . Car stocks are up really strongly as well. They are all outperforming the stoxx 600, which is up a healthy 3 . The commodity story absolutely front and center, as a result of which we are seeing Commodity Currencies doing very well. You can see the aussie dollar trading up by 1. 15 . Up by 1. 15 . As you say, we are seeing rising around 0. 71 . Vonnie exactly. Chinese president xi jinping addressing the World Health Organizations governing body at its annual summit in geneva earlier today, offering a promise of cooperation on on a possible vaccine. Have a listen. Vaccine deployment in china, when available, will be made a Global Public good. This will be chinas contribution to ensuring vaccine visibility in developing countries. Vonnie we are joined now by tina fordham, avonhurst partner and head of Global Political strategy. This is very interesting. It wasnt scheduled, a bit of a surprise appearance. Xi have president basically extending an olive branch at it kind of the u. S. Seems to be doubling down on accusations that china led the coronavirus into the world. What happens next between the leaders . Toa a little bit of context xis announcement is also the at the who assembled many nations said the origins of the coronavirus should be investigated, so china is in the hot seat, not just with sharper rhetoric coming from washington, but with other countries in the world. We were expecting u. S. China tensions to ramp up ahead of u. S. Elections in november, not just because of the virus. This is one of the few genuinely bipartisan issues in the United States, china bashing. I was reminded of bill clinton doing a similar thing in the termp to his second campaign. So i think we will see tough rhetoric from washington that perhaps is more bark than bite. Vonnie would that be in order for the reelection effort to get going . Obviously, and the next few months, the president in the United States is going to be thinking about november primarily, possibly more so than demic reaction tina reaction. Tina well, hard to see inside president trumps mine, but he is said to be in permanently campaign mode. Meanwhile, joe biden cant campaign and is struggling to deal with that, but the president will be focused on the economy. Of course, he has always seen the performance of the s p as a barometer of his success, so the s ps seem to be supporting him in that respect. But we heard from the u. S. Fed in Jerome Powells latest interview about the u. S. Economy not likely to recover before perhaps the end of this year, it will not be good news for the president , who has focused on the reopening of the country and accelerating that, in large part due to its impact on his own reelection prospects without a strong economy. Guy good afternoon. Lets talk a bit about what europes relationship with china is going to look like Going Forward from here. In an hour, we are going to see a joint press conference between Angela Merkel and the french president. Clearly, they are being severely impacted by what has come out of china. How has europes relationship changed . Do you think their approach will change as a result . Pressureope is under from the covid19 crisis and what that has done in particular for highly indebted european Member States like italy, so getting macron and merkel to agree on things is really no mean feat, but if i were to describe how europe is being put to the test with relations to china, it is between a rock and a hard place. France, and its historically protectionist stamps, has always been more skeptical. I think we are likely to see a bit of a Holding Pattern when it comes to china, but the u. S. Is pressuring europe when it comes to relations with huawei and all of that. There isnt a lot that europe can do right now. Ok. Lets talk a little bit about what you just mentioned with reference to italy. Does this pandemic represent an existential threat for the European Union . Aboutare serious concerns italys debt load and whether it can manage to maintain itself as part of the single currency. What is your expectation . Do you think that italy represents a threat to the fabric of the European Union, and by extension, the single currency . Tina i think italians are justified in their great disappointment with the poor response from brussels and other european Member States, and remember, that goes as far back as germany not allowing the export of ppe to italy when italy was the worst hit by the crisis. Before that, italy struggled with lack of support for refugees, with italy one of the main eu countries receiving those. What italy and spain and other what we used to call peripheral countries were looking for was a measure of economic solidarity, and that has been pretty disappointing. Crisis andes to this its impact on the European Union, the eus obituary has been listed many times before. I am certainly no euro skeptic, but euro has disappointed when it comes to both economic solidarity and and its frankly slow response to the crisis. We are going to see that up next, by the way, when it comes to brexit negotiations. We havent had to talk about the b word for a while, have we . Vonnie no, we havent. What happens to the brexit negotiations . A sensibly things got back on track, and then Michel Barnier says absolutely not. Theres nothing happening on these brexit negotiations. What is your best forecast for what comes next . Tina well, i have been of the might havehe u. K. The grounds to ask for an extension because although the official end of the transition is the end of december, the u. K. Would actually have to request an extension on negotiations by july 1. The coronavirus and its severe Economic Impact on the u. K. Provides a pretext, and frankly,o does the Public Opinion data but it doesnt look like Boris Johnsons government is going near that. We can see that in how sterling has reacted and the fact that some of0 has redeployed the people that had been focused on the covid19 response to no deal brexit preparations. So we are going to see a lot more about that. I do wonder if there isnt going to be some possible sort of third way between a no deal brexit in december, which would lead us to trading on wto rules, or an extension, which is politically deeply unpalatable for the conservative party government. Thelly with politics, it is art of the possible, so i wonder if some third way will emerge. But nobody is talking about that yet, and i wouldnt expect to hear Boris Johnson doing so either. He feels it is nonnegotiable for his core supporters. Vonnie i want to move to your ideas about globalization and the seminormal that comes next, and particularly the difficulty for em countries. Even just looking at brazil, weve had two Health Ministers in two months. That country is really in trouble. It look like for emergingmarket regions in the world . Tina in a sense, i think it is important to remember that canceling everything and centralbank response, and writing checks in developed market governments has been the easiest part. There are the shock ways, second and third order effects, including political risk, countries that might decide to take it vantage of the preoccupation of World Leaders and try to undertake landor power grabs undertake land or power grabs. Then we could see pressure on weaker social safety nets, as well as the wider impact of a dramatic slowing of the economy. I think it is at that point we are going to see that the closing of the Global Economy might actually result in much greater costs to emerging markets in frontier Market Countries then we have been thinking about, and there will be much more pressure on how to combat these. Leaders like bolsonaro in brazil , of course, he was a virus denier and is now seeing the consequent as of that. But remember, markets welcomed bolsonaros victory. Populists, but really dont seem to mind right wing populists. I wonder if that isnt going to be another element of how the virus turbocharge is the future, what kind of populists might we see if we have poor policy response. Vonnie wonderful stuff. We will check in with you again very soon. Thanks for your time today. That is tina fordham, avonhurst partner and head of Global Political strategy. Lets chicken on first word news. Heres ritika gupta lets check in on first word news. Heres ritika gupta. Ritika that your jay powell says the economic downturn could continue through 22 anyone. Through 2021. He said a full recovery depends on people being confident, and that will not happen until a vaccine is available. Traded visor Peter Navarro suggested beijing sent Airline Passengers to spread the infection worldwide. China has pushed back and says the u. S. Is lying. Bloomberg has learned oil demand in china is almost back to where it was before the coronavirus outbreak. China is the worlds secondlargest oil consumer, and the quick turnaround has helped tighten the Petroleum Market sooner than expected. Demand for oil plunged 20 after the country went into lockdown in february. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Guy thanks very much, indeed. Coming up, ford, Fiat Chrysler, g. M. All opening up their factories in the United States. How fast can they ramp up, and will be supply chain to be able to cope . Thats coming up. This is bloomberg. Guy live from london, im guy johnson, with vonnie quinn in new york. This is bloomberg markets. Something of an equity rally on our hands globally. Lets get the details with kailey leinz. Kailey we had a broadbased rally on this monday morning. Optimism about economies reopening, perhaps about a covid19 vaccine coming from moderna, optimism about the feds ammunition to fight any kind of downturn. We have u. S. Stocks higher. The dow is up nearly 700 points, the s p higher by 2. 5 . Check out small caps. The russell 2000 is higher by nearly 5 . Want to take a look at some individual smallcap movers rally this morning. The narrative is that the economy may be opening back up. Marriott vacations is up by about 7 . Penn National Gaming up by 8 . Consumers due to start opening up regionally. Kb homes higher by more than 12 as home viewing may become an option. Lithia motors of about 8 . There may be pentup demand for car sales, especially of people may be more relevant to use public transportation. I want to speak broadly about the equity market and talk about volatility. Vix is low as 30, looking at a 29 handle on the fear gauge today. Last week, we saw stocks down on the week, volatility was also lower. It was more subdued, so things are getting more orderly and the stock market. Finally, oil is surging more than 10 today. Wti back about 30 a barrel. We havent seen that in about two months. Producers pulling back on their output, signs of demand picking up, especially in china, and that is lifting the commodity and Energy Stocks along with it. Players like exxon up 5 and lumber and schlumberger higher. Guy thanks very much, indeed. Ford, and Fiat Chrysler all reopening planes in the u. S. For the first time in nearly eight weeks. Reopening plants in the u. S. For the first time in nearly eight weeks. What does a phased reopening actually look like . How much capacity is coming back online here . Reporter less than half because politically speaking, this is all controlled out of the state of michigan. Once the governor said they could open up, she said it had to be staggered, one shift only. Theres some any plants that, if they dont get michigan going, the whole industry doesnt really go. There are 30,000 parts in a car. If you are missing one, the car doesnt get made. So they will produce one, and if things go pretty well for two to four weeks, maybe you could see them go into a second shift. The other part of that equation is how much demand is out there, and will they even need second plant shifts to get going. That is a big question that really hasnt been answered quite yet. Vonnie exactly. F150she pickups, the and so on, do so well in the last few months. But who has need of those these days . What are the carmakers and analysts forecasting in terms of demand for the next few months . David they are forecasting a steady ramp up. Most analysts are saying that , weve seenll be estimates as low as 10 million and is highest 13, down from last year, which was 17 Million Units for the u. S. Car market. Help forhing that will General Motors and Fiat Chrysler is pickup truck sales didnt actually do that badly, with that being a very relative statement. Vehicle sales are down 50 or 60 in march and april. Pickup truck sales were down 15 , 20 , depending on the week, which, all things considered, wasnt terrible. They havent produced in eight weeks. That means there could be inventory shortages. We know General Motors has inventory shortage in pickup trucks, so they will try to bring up their plans as quickly as they possibly can, and those vehicles mike a lot of money. So the Second Quarter is not going to be great for anybody, but if they have more pickup production, that does mean pretty good profits, or at least mitigating losses we may see. Guy you just talked about inventory. Let me talk about inventory from a different angle. s clearly rely heavily on their supply chains. How is the supply chain, particularly when you get past the tier one, even the tier two suppliers . Could these factories find themselves reopening and then having to close because they cant get that final last little widget . David that is a big concern for a couple of reasons. First of all, most Assembly Plants have about a weeks worth worth of parts in transit or on the docks at the plant themselves. There are some any players out there making so many parts. If somebody didnt get back up and running, if they dont have the right masks and medical equipment for their workers, and they get shut down by a state inspector or Something Like that some place, that is a problem. The other issue is mexico. Mexico is not going to be up and running until next week. If there are parts coming out of there, and there hasnt been some way to get inventory up quickly, that could result in some shortages. The fact that they are starting a simply plants on one shift, you dont meet ats you dont need as many parts. That could help ease everybody back into work. Vonnie david, thank you so much. That is david welch, bloombergs Detroit Bureau chief. This is bloomberg. This is bloomberg. Largesize invest these are surviving and doing steady, and had a better chance of going through this valley of coronavirus. The exception is wework. Weeding we made a mistake in investing in wework. I was foolish and made the wrong decision. Vonnie a tough admission from mustier she some from Masayoshi Son. The vision fund at softbank losing 17 billion. The fund was one of the mammoths in private equity and raising cash. In fact, Masayoshi Son was to raise a new one every couple of years. Uber and wework decimating returns, that is definitely off the cards right now. Guy it looks like this could be the last one ever, doesnt it . The idea of massive funds and the disproportionate effect they would have, and you saw that effect in Silicon Valley as they try to throw money at some of these businesses. That had a big gravitational effect in Silicon Valley. Interesting that jack ma is going to be leaving the board. I think hes been on the board for around 30 years. This is bloomberg. Imie live from new york, vonnie quinn, along with guy johnson in london. This is bloomberg markets. We are joined by Goldman Sachs head of the urban investment group. We are also joined by bloombergs sonali basak. Thank you for joining us. Explain to us how much and where this money went out of goldmans coffers and into Small Businesses around the country. Margaret sure. We made a 500 million commitment to make Small Business loans available to businesses around the country, and we wanted to make sure that capital reached the most underserved businesses until we decided to employ that exclusively through community now over ad we are month and a half into that program, and we have been really excited about the data we have seen so far. These lenders operating in rural areas in the south to dense parts of new york city, to california, to ohio. They have been able to make loans that are very small. If we look at the median account of businesses they have served, it is just three. These are your barbers, tailors, the real Small Businesses that i think we have all been concerned might not be able to get this capital if they didnt have a banking relationship or just had never taken out a loan before. The other thing we have been really encouraged by in the over 8000 businesses that have been reached to date is where they are. These are businesses in low income communities, so 1 3 of the capital has gone to poor neighborhoods, and roughly half has gone to minority communities. Why that is important, these are the same neighborhoods suffering from disparate impact around health outcomes. Like an brown folks are suffering from higher levels of unemployment. The fact that these Community Lenders have been able to deploy almost half of that capital to those neighborhoods is incredibly reassuring and important. Sonali the sba Inspector General even showed that a lot of people in these communities may not have generally, outside of Goldman Sachs, received the aid they may have needed. Given that you are working with some any of these communities, what is the hold up . How can this change . When you look at a lot of the banks, they tend to prioritize existing clients and larger towards the people who and larger clients. How do you get this towards the people who need it . Margaret you really need all hands on deck. For the community we are focused sameany do not have the density of Bank Branches as some higher income neighborhoods. For minority business, they are disproportionately smaller. These are businesses that, regardless of the bank , so i think what is needed is to make sure we are distributing not just the capital, but the awareness about the awareness about the capital in creative ways, whether ,hrough Small Business centers churches, all sorts of organizations that have the credibility and the reach within these communities to understand the businesses need and to be able to transfer this into an actionable loan that the businesses can get. I think we saw this with the institutions we worked with, including in new york, california, and texas and the south. They were able to, and a very handson way, reach these smaller businesses and get them this loan capital. Sonali given the banking penetration being so much lighter in these areas, does that mean the government needs to step in and do more to get that money to the people who it . Margaret i think part of it, unfortunately, that we saw is how you balance this urgency and time. These businesses need this capital fast. We see the forced closures. We see the real pain with these businesses having to lay off workers and be uncertain about their future. Of the same time, you also have to be thoughtful about how that capital is distributed. This idea that all of the capital was going to be immediately distributed to even these tiny businesses in a matter of weeks, using only the , it isank infrastructure about how that money gets across. To the government needs to listen to these businesses, understand their needs and make sure it is taken into account, and understand who are the partners can reach these businesses in minority communities. Those need to be the entities that have the capital to distribute it, and that is what we tried to do with our 500 million. Guy margaret, the big question a lot of investors are trying to is small and medium businesses are the backbone of the economy. How many of them are going to be in round when the economy starts to reopen . How many survive what has been a really tough time . You talk to if her number of businesses. You talk to people who have contact with these businesses. What did they tell you about with the reopening is going to look like . Margaret when we talk about Small Businesses, it is interesting to group is mrs. By size. You are talking about everything from the two Group Businesses by size. Youre talking about everything from the hairdresser to the community clinic. I think it is all about with the Recovery Capital is going to look like. If you look at what ppp did, it is a little about stemming the bleeding. How can we get payroll extended for six weeks . Even when the ppp program was designed, i dont think anyone thought we would still be sitting here, not opened up yet. So what does this reopen really look like . When is it actually going to happen . It takes more for a business to legally allowed to be reopened. Takes roughly 75 occupied to just break even. What are consumer fears looking like . Are we going to be going to restaurants . What does it look like in these restaurants that support retail . Theres a lot that we dont know. Many of these businesses will be able to come back and survive. One of the interesting things that came out of the fed data we saw last week was that even though 40 of households with 40,000 in income and less lost a job, 90 of people who lost jobs that they would be returning back at some point to their previous employer. I think we just need to see what these reopening look like, how these businesses are going to fare, and what the next round. F capital looks like we are just really in the beginning. 75 of your workforce, if you were to keep that number on for those loans to be forgivable, that is quite a high bar to meet when you dont even know what kind of demand you are going to meet with when you can reopen your business. Do you imagine if thats relaxed that you will see a flood of new applications . Margaret it is interesting. We all saw and the house bill that that was something that was proposed, so lengthening that time for forgiveness beyond the eight weeks and also being more flexible about that payroll requirement. I think obviously, we have heard a lot from the businesses we are engaged with that eight weeks is not enough, and for many of these businesses, that payroll is just not something they are going to be able to maintain. I think the other part to about is that even if that loan is not forgivable, it is still a loan that doesnt require a guarantee , that doesnt require any collateral, and is at an attractive 1 interest rate. I think theres going to be many businesses that, even if they cant fulfill the requirements to get the forgiveness, they can still use it is fairly inexpensive liquidity in the short term. Sonie margaret, thank you much. Looking forward to more updates. , head ofargaret anadu Goldman Sachs urban investment group. Stephane, moderna ceo bancel joins us. We will get the latest from the ceo next. This is bloomberg. Vonnie we welcome our radio and tv audiences worldwide. Joining us from boston, massachusetts is moderna ceo stephane bancel. The companys vaccine showing promising early signs. Thank you for joining. A robust immune reaction is what we are seeing out of your early phase trials. The next phase underway. How big will it be . How many people will be involved . Stephane yes, thank you for having me. Phase one. The next study is phase two, around 650 test subjects, that when thet very soon u. S. Has given us the green light. We said this morning we are finalizing phase three, which is the last, which we are hoping to start in july of this year. The study would be several thousand test subjects across many countries. We are finalizing this as we speak, and we are hoping that we can start in july as planned after enrolling all of this people in the study. We should be able to move forward to get a good sense of the efficacy of the vaccine and move towards commercial approval by the end of the year. Vonnie in terms of data, how many doses does it look like the drug will need to be used in . The levels terms of that regulators are looking for to establish benchmarks of success, what would you want those to be in the u. S. . Stephane yes, so we tried to five micrograms, 100 micrograms, and 250 micrograms. You try different doses for what will get the best response. We are very pleased to report all participants at the 25 and 100 micrograms showed antibodies in their blood coming. Rom vaccination in the blood of people who were being infected, which is where we are looking for how many antibodies you need. Guy i have a couple of questions to follow up. Getfirst one is when people covid19 naturally, do they have immunity once theyve had it . Your producing more antibodies that are a natural response. I am wondering, is it a longevity issue . If you are producing greater amounts of antibodies with your therapy, do i get longer immunity than i would if i actually had covid19 . That is what we believe. I want to be careful because as we know, as report on the virus, we are learning a lot about this virus, and i think all of us have to be very cautious about the statements we make around the biology of this virus. We believe that people are able boost [indiscernible] and we have shown that before. We have just finished phase two study and another virus, which is a very nasty virus. It can have a very bad effect. We are seeing people who were never exposed to the virus who are on 10 to higher antibodies than people exposed to the virus. But we are seeing a boost to provide them stronger immunity. Older people tend to have less effective immune systems, the am curious, you have initial and a booster that comes after it. Is it possible that older people will get a bigger second dose . Im not sure exactly which way it is going to work, but could you tailor the first one, the primary on the secondary one, depending on age to ensure that less effective immune systems can generate the kind of responses you are talking about . Stephane the Current Study uses aresame dose, but we studying different ages. The Current Study is 18 to 25 years of age, so a normal adult immune system. We would like to see which is why we do those clinical studies. Is the boost shown is very important, especially people with a weaker immune system like the elderly or the very young. [indiscernible] and three or four weeks after is when you actually create memory immunity, which is very important. Data have seen that customized for different age groups, and we will use that to design the best product we can. Vonnie what have the analyst and investor communities suggested regarded the pricing models should this actually come to market commercially eventually . You must be thinking about pricing. As i shared this morning, we have been so busy in the last four months to just focus on getting the vaccine to move assessed about as fast. S possible in the sequence the green lights are going to eisen didand faisal his and finalizing the design of phase three. In france, we Just Announced a very Strategic Partnership to boost our manufacturing capacity. Doses toe plan to make provide hundreds of millions of ple, so [indiscernible] to do around 100 million doses per year, which is very large. But compared to the people on this planet, it is very tiny. Providee working to over one billion doses per year, so this partnership is very important. We can use their keep abilities to scale up the manufacturing process to millions of doses per ofth, too soon thousands millions of doses per month, to soon come close to 18 million doses and more doses per year. So we are already focusing on that, and what we are going to vaccine. Out the what is the value of this vaccine to the health care . Ystem [indiscernible] that will launch in the next month or so. , we ofn with governments course course want to be responsible given the pandemic. About i want to ask you the backandforth with the administration and how critical that is. Million received 500 from the administration in federal funds, and one Board Members have become a chief scientist. How critical is administration support, and will the u. S. Be first in line at the end of this if it works . Stephane that is a good question. In largeof government formation is critical. I believe that what we have seen today, theres a good probability that the vaccine will show the efficacy we have , show that we can prevent replication of the virus within the lungs. What i worry the most about is so far, we have not been able to on many factoring capacity. If we wait for the product to be usually it takes five to 10 years to get a vaccine approved. If we dont have enough capacity, people are going to die. Economies are going to stay impacted. A very large Clinical Study is very helpful, but we have not received any help towards buying equipment, buying Raw Materials so we can make as many of those as we can now, so that they are ready to ship. Guy i have a couple of questions actually, rolled into one. The first country, the first region to approve it gets the vaccine first, following up on vonnies question. Messenger rna vaccines in the past, have we ever seen a messenger rna vaccine approved thus far . Do you think it is going to be harder for a messenger rna vaccine to be improved to be approved . So does the first region to approve it get it first . Will there be any order of sequencing on who gets at first . Is there any pressure from any country to get it first, i. E. From washington . And is it harder for a messenger are in day to get approved for a messenger rna vaccine to get approved . Stephane we are only allowed to provide the products where approved. As you know, medicine is highly regulated. In the u. K. , if the vaccine is not approved, we are not allowed by law to sell the vaccine. If it is approved in the u. K. , it can onlye u. S. Be in the u. K. The amount in question, it is [indiscernible] inject it intou cells, weman believe it is a important longterm safety feature that is very careful to mix with human dna. This is critical from a safety standpoint. So we are working hard to try to help people. We are planning to do very large studies for phase three. There will be many thousands of individuals that we tend to enroll in the u. S. And europe because these vaccines will be made available for millions. Vonnie we are all looking forward to seeing her results. Your stock is up 22 point type today. The street very pleased with the performance. Thank you to our radio listeners for joining us. This is bloomberg. Guy live from london, im guy johnson, with vonnie quinn in new york. We are counting you down to the european close right here on bloomberg markets. European equities absolutely flying right now, but it is very much the dash for trash, the stuff that has been beaten up doing the best today. Car stocks doing well, the mining stocks doing well. Car stocks boosting what is happening in the dax. Weve also got some news coming out over the last couple of seconds, and i think we are expecting a macron merkel press conference, the eu said to be mulling a 500 billion euro coronavirus recovery plan. That doesnt sound like a lot of money to me, but we will talk to erik nielsen of unicredit in just a moment to get his take. We will get some headlines coming through as well. We cut the stoxx 600 up by 3. 53 . The mining stocks even more, at session highs, up